Consumer sovereignty in the framework of social justice, economic equality and environmental balance, within and across borders

Fine transport firms over fare cut delays

September 10, 2015

– HCMC – The vice chairman and general secretary of the Vietnam Valuation Association has called on authorities to fine transport enterprises that have delayed lowering fares despite multiple rounds of fuel price cuts.

It is unacceptable that transport charges have not gone down though fuel prices have been sharply slashed, Nguyen Tien Thoa said at a seminar on transport charges and benefits of consumers held by the Vietnam Standards and Consumers Association (VINASTAS) on September 8.

Thoa said gasoline and diesel prices fell by VND3,380 and VND2,760 per liter respectively between July 4 and September 3.

Compared to fuel prices before July 4, gasoline slid a total of 16.3% and diesel 17.21%. Transport prices should be lowered as other costs like pay have not picked up in the past two months.

As analyzed by Thoa, with gasoline-fueled vehicles, fuel cost makes up 25-35% and transport fares should be reduced by 4.1-5.7%. For instance, taxi fares of VND11,000-12,000 per kilometer in Hanoi and VND14,500-15,500 in HCMC could be slashed by VND448-685 and VND591-884 per kilometer respectively.

Meanwhile, diesel cost accounts for 35-45% of operational costs and a price reduction of 6-7.75% is feasible. If current transport charges are around VND550 per kilometer, they could be cut by VND33.17-42.64 per kilometer. And if so, with a journey of around 150 kilometers charged VND82,500 per ticket, the ticket price could be reduced by VND4,975-6,397.

According to Thoa, taxi fares in Vietnam are much higher than in regional countries. Average fares in Bangkok, Manila, Jakarta and Singapore are VND3,800, VND5,700, VND6,300 and VND8,700 per kilometer respectively. Therefore, Hanoi’s taxi fares of between VND11,000 and VND13,900 per kilometer are 26.4-60% higher and HCMC’s taxi fares of VND14,500-15,000 per kilometer are up to 66.7-78.2% higher than the regional average.

Thoa suggested imposing bold administrative fines on transport enterprises which have not lowered charges.

Consumers should also protect their interests by asking for charge adjustments when signing contracts with transport firms. Besides, authorities should publicize the names of enterprises which have lowered transport fares and which have not, according to Thoa.

VINASTAS’s vice chairman and general secretary Nguyen Manh Hung said taxi firms often cite the complicated and costly taximeter re-installation as an excuse for their late fare adjustments. Such an excuse is not convincing as taxi firms never clarify how complicated and costly it is to adjust taximeters.

Hung called for relevant State agencies to look into transport firms and take punitive sanctions against violators to ensure fair treatment of consumers.

Pham Que Anh from Consumer Unity and Trust Society (CUTS) said the transport ministry should create an open market for new players to join and a favorable environment for healthy competition.

(By Le Anh – The Saigon Times)